US stock market futures rose on Wednesday due to the market’s optimism that the launch of the Covid-19 vaccine and the conclusion of a new fiscal stimulus bill heralded an economic rebound.
Futures related to the Standard & Poor’s 500 Index rose 0.5%, while the Dow Jones Industrial Average futures rose 0.7%, indicating that the two benchmark indexes will rise after the opening of New York. The Nasdaq 100 index contract rose 0.5%, indicating that technology stocks rose a day after investors withdrew from the industry, dragging down broader indicators.
In recent days, stocks have been jittery, with major indexes fluctuating between losses and gains every day.
On Wednesday, the market sent a signal that encouraged people̵
Seema Shah, chief strategist at Principal Global Investors, said: “Compared to many expectations, the vaccine delivery situation is very good.” “When it seems that the economy can recover on its own, we also have the prospect of adopting fiscal stimulus measures in the background. This has led many people to raise their expectations of US economic growth.”
Eaton Vance (Eaton Vance) global head of equity Chris Dyer (Chris Dyer) said that optimism about the better economic outlook is particularly driving demand for company stocks, which will benefit when the economy returns to normal. These include banking and energy stocks, which have outperformed technology stocks this year.
Dyer said: “We can see the light at the end of the pandemic.” “The progress made in vaccination has made people confident in the economic recovery. You have seen that companies that have adapted to the economic recovery have good performance.”
The bond market has also calmed down recently. Earlier increases in yields made investors feel uneasy and caused stocks to fall sharply. The 10-year U.S. Treasury bond yield rose to 1.449% from 1.413% on Tuesday. This is still down from 1.513% last month.
Senior central bank officials have said that rising yields reflect optimism about the economic outlook. Fed Governor Blair Nanard said on Tuesday that the recent bond market turmoil is on her radar screen. She said that the Fed will not withdraw its support for the economy until the economy stabilizes, reiterating the comments of other officials.
“The Fed has stated very strongly that they are willing to wait patiently, but at the same time [that] Rising yields indicate strong growth, so this is a good environment for stocks to enter. ”
Before the market opened, Lyft was up nearly 5% after the ride-sharing company announced strong February ride-hailing data on Tuesday night. Rival Uber (Uber) also rose 3%.
Investors are waiting for data on service industry activity from the Institute of Supply Management at 10 am Eastern Time. These figures are expected to show the ninth consecutive month of growth in activity across the industry in February.
The Fed’s beige ledger report is scheduled to be released at 2 pm Eastern time and will provide the latest collection of business anecdotes and provide insights on how companies are preparing for the economic reopening.
In the commodity market, the international oil benchmark Brent crude oil rose 1.5% to $63.63 per barrel. The price of gold fell by 0.7%.
Overseas, the pan-European Stoxx Europe 600 rose 0.4%.
As of the close, most major Asian stock indexes rose. China’s Shanghai Composite Index rose nearly 2%, while Hong Kong’s Hang Seng Index rose 2.7%. Japan’s Nikkei 225 edged up 0.5%, while South Korea’s Kospi rose 1.3%.
Write to Will Horner at William.Horner@wsj.com
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